Avici Systems Announces Second Quarter 2005 Results
North Billerica, MA, July 21, 2005 — Avici Systems Inc. (NASDAQ: AVCI), today reported results for its second quarter and six-months ended June 30, 2005.
Gross revenue for the three and six-months ended June 30, 2005 was $11.6 million and $22.4 million, respectively, compared to $12.1 million and $19.1 million, respectively, for the three and six-month periods ended June 30, 2004. Revenue, net of common stock warrant discount, for the three and six-month periods ended June 30, 2005 was $11.1 million and $21.3 million, respectively, compared to $11.6 million and $18.0 million in the comparable 2004 three and six-month periods.
GAAP net loss for the second quarter ended June 30, 2005 was $2.7 million, or $0.21 per share, compared to a GAAP net loss of $6.3 million, or $0.50 per share, in the prior year's second quarter ended June 30, 2004. GAAP net loss in each of the 2005 and 2004 second quarter periods includes $0.5 million for non-cash equity based charges, primarily common stock warrant discount, offset in the 2005 and 2004 second quarter periods by credits of $0.2 million and $0.5 million, respectively from the utilization of certain inventory previously written off. Additionally, in the second quarter of 2005, GAAP net loss benefited by $1.8 million, reported as other income, from $1.3 million in proceeds and the reversal of certain previously established reserves in connection with the company's favorable disposition of a claim in bankruptcy.
GAAP net loss for the six-months ended June 30, 2005 was $8.3 million, or $0.64 per share, compared to a GAAP net loss of $15.3 million, or $1.22 per share, for the six-months ended June 30, 2004. GAAP net loss for the six-months ended June 30, 2005 is net of $1.1 million for common stock warrant discount offset by $1.8 million in connection with a settlement of a claim in bankruptcy and $0.3 million of inventory credits. For the six-months ended June 30, 2004, GAAP net loss is net of $1.1 million for common stock warrant discount plus certain stock based compensation of $0.2 million, offset by $0.7 million of inventory credits.
Non-GAAP net loss (GAAP net loss excluding charges for common stock warrant discount, certain stock based compensation, inventory and settlement credits,) and net loss per share for the three months ended June 30, 2005 and 2004 were $4.1 million, or $0.32 per share, and $6.2 million, or $0.49 per share, respectively. Non-GAAP net loss and net loss per share for the six-months ended June 30, 2005 was $9.3 million, or $0.73 per share, compared to $14.8 million, or $1.18 per share for the prior year six-month period ended June 30, 2004.
Both GAAP and non-GAAP bottom line results for the three and six-month periods ended June 30, 2005 were significantly improved over the 2004 comparable periods due to stronger margins on primarily direct versus distribution revenue, product mix and lower period over period operating costs.
Cash, marketable securities and long-term investments totaled $62.3 million at June 30, 2005.
Bill Leighton, President and CEO said, "We are extremely pleased with our performance for the quarter and year to date as we show strength in revenue growth, cost containment and cash management." Mr. Leighton continued, "We remain committed to diversifying our customer base."
Avici will discuss these quarterly results in an investor conference call today at 8:30 AM eastern daylight savings time. The conference telephone number is 866-847-7859. A replay of the conference call will be available after 1 PM. Replay information will be available at 800-475-6701, access code 788762. Replay of this call is also available on Avici's Web site, www.avici.com, along with a copy of this release.
About Avici Systems
Avici Systems Inc., headquartered in North Billerica, Mass., is a leading provider of purpose-built carrier-class routing solutions for the Internet. Avici's family of routers is designed to meet carrier requirements for the highest scalability, reliability and network availability, while lowering the total cost of building and operating their networks. The company's routing systems provide new IP solutions to some of the world's leading service providers. For more information, please visit us at www.avici.com.
Avici is a trademark of Avici Systems Inc.
This release contains information about Avici's future expectations, plans, and prospects that constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. When used in this press release, the word "will", "expected" and other similar expressions are intended to identify such forward looking statements. Such risks and uncertainties include, but are not limited to, market acceptance of Avici products, services and enhancements, customer purchasing patterns and commitments, development of the market place, product development and enhancement, intensity of competition of other vendors, technological changes, reliance on distribution partners, risks associated with international expansion, and other risks set forth in Avici's filings with the Securities and Exchange Commission.
| For more information contact: |
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| Inna Vyadro Director of Investor Relations Avici Systems 978-964-2000 ivyadro@avici.com |
Paul Brauneis Chief Financial Officer Avici Systems 978-964-2000 pbrauneis@avici.com |